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moneymetals

No Gold and Silver? So Far, So Good...

Screen shot 2019-02-25 at 9.56.16 am.png

In the original (1960) classic movie The Magnificent Seven, a Western adaptation of Kurosawa's The Seven Samurai, Vin (Steve McQueen), tells the wry tale of a man who fell off a ten-story building. Passing each floor people heard him say, "So far, so good!"

This strange little tale is an excellent metaphor for many of today's citizens around the globe.

Through the multiple lens of news reporting, political commentary and social media, they see what's going on yet remain transfixed in the moment, because things are well, so far, so good.

Venezuelans have done so even as adults there have lost an average 20 pounds, while their "leader" may have gained even more!

So far, so good... until it isn't.

On November 20, 2016, Indian Prime Minister Narendra Modi banned 500 and 1,000-rupee notes (worth respectively about $7 and $15). His edict – supposedly to crack down on untaxed, criminal used "black money" – instantly nullified as legal tender, 85% of all cash in circulation. People literally died standing in massive bank access lines.

Price of gold in india vs u.s.

Courtesy Manward Press

And what happened to gold because of this? Overnight, the domestic Indian price almost doubled!

These things (like FDR's surprise gold ban and Nixon's defaulting on the final link to a gold standard), tend to be preceded by an official government denial.

And it's usually over the weekend, when markets, banks, and local coin dealers are closed.

In an ad for the advisory letter, Manward, Andy Snyder makes the case for something similar happening in the U.S., saying:

... if you prepare well for the inevitable death of cash in America, you can set yourself up to avoid the pain and collect a hefty sum of money. Very soon, I expect the Federal Reserve will make the historic move away from cash and toward electronic money. It will accelerate the shift to a cashless America at light speed. Some investors will get killed; some will get very rich.

He then discusses electronic gold, but the key takeaway for us is that holding physical gold has always been – and will continue to be – a way to backstop the value of your other "assets," even if they are ground away because of government negligence or societal unrest.

Full article here: https://goo.gl/ZMhveB

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Schweinderl